Learn and Plan | How to prepare for end-of-year costs
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How to prepare for end-of-year costs

Nov 1, 2022, 1:16:32 PM | Reading Time: 3 minutes

With the end of the year approaching, it’s a perfect time to review your finances, check in on your spending, evaluate your budget, and set your financial goals for the New Year. January offers a fresh start and the actions you take today can help set yourself up to make healthy financial choices in the days ahead. To get things rolling in the right direction, here are eight end-of-year financial planning moves to help pave the way for financial success.

Review your finances

With a new year about to start, it’s time to take a look at your budget and review this past year’s spending habits, any debts you still owe, as well as looking at the previous financial goals that you set at this time last year. If you missed the mark on some of your targets, take the opportunity to see which ones can be updated or eliminated according to your current financial situation. Will any of these goals roll over to next year? Are there any areas where you could cut back your spending? Could following a few budgeting tips provide a way to help make your goals achievable and put a little more money toward savings? Taking your financial pulse at the end of the year can help you fine-tune your budget and get you better prepped for upcoming purchases.

Budget for specific goals

As you think about the New Year, what financial goals do you have on the horizon? Maybe you’d like to begin an emergency fund, take a dream vacation, buy a new car, or start saving for retirement or your child’s college education. Whatever goals you have in mind, it’s best to start planning for them as soon as you can. By revisiting your budget regularly, you can ensure you have money to allocate towards these goals and avoid overcharging your credit card or dipping into your emergency savings fund. Assign a date to each goal and how much you will need, so you can start putting funds aside each month.

Organize your financial records

An important step to getting your financial life in order is making sure your documents and records are organized. Not only are they essential for taxes, but you may need them to show proof of legal contracts, insurance claims, and residency. You can follow these organizational tips to help create a filing system, store receipts, and secure your electronic financial documents.

Prepare for the holidays

With the arrival of the holidays, the end of the year can be an expensive time for many people. If you didn’t factor holiday spending into your budget this year, consider doing so as you plan for the months ahead. When you have gifts, travel, and other related costs included in your overall budget, you’ll be less likely to overspend or begin the New Year trying to pay off holiday debt.

Check your beneficiaries

The end of the year is a good time to review your insurance policies, will, estate plan, and trusts and who you have designated as your beneficiaries. If you’ve experienced any life changes, like marriage, divorce, or the birth of a child, you’ll want to make sure the names you have listed reflect your most current wishes.

Assess your 401(k) contributions

If you’re enrolled in a retirement plan through your employer, take this opportunity to review your contribution amount and whether you want to increase it for next year. Many employers offer a match based on your contributions, so this can be a helpful way to put more money toward your retirement fund. Take a look at your employer’s policies on 401(k)s and how you can maximize the opportunities available to you.

Speak with a financial professional

To make the most of your year-end review, it can be a great time to meet with a financial professional. He or she can make sure you’ve checked all the boxes, help answer questions, and offer some useful strategies for achieving your goals. There may be opportunities that you haven’t thought to explore and together you can discuss which options match your vision for the future. A new year often brings new purpose and new goals, so take a moment to assess your financial situation and bring your resolutions to life.

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REV 11/2022